A fresh look

Leveraging corporate brand equity for competitive advantage is the job of all departments

Steve Jobs stood up earlier this year to launch the iPad, the latest in a long line of technological innovations his company, Apple, has introduced: in 2007, he had stood up and announced the launch of the iPhone, which revolutionised the mobile phone market; six years before that he had presented the iPod and changed the mobile music world.

Why has Apple been so successful in non-heritage areas when other companies may struggle for years?

Pharmaceutical companies are searching for new revenue streams by diversifying into new areas, and the question of how to succeed in non-heritage markets — for example, diagnostics, emerging markets and consumer healthcare — is of critical importance.

At the launch of both the iPod and the iPhone, the Apple logo was everywhere. The corporate brand has strong associations in the consumer mind: when the consumer sees the logo, he knows he will receive a great experience. Therefore, the brand's notions of innovation and fearlessness were used to provide a platform from which to launch the company's new products.

Now imagine a pharmaceutical company chooses to diversify; what would the company name mean to the new stakeholders? How could the values of your company help you to transcend a new category? What do you think your customers see as the essence of your company?

Perhaps most crucially of all, how would your company's brand equity help you to launch into a new area?

Traditionally, corporate reputation has been the remit for PR and communication departments. The example above shows how corporate brand equity can be used for success in one area — namely, new market entry — but it is important for so much more. Now, corporate brand equity is equally a concern of those in the business intelligence and market research functions, who can make a significant contribution in this area.

The growing need to act"A belief that our prices are too high, that we run misleading advertising, and that we care more about playing golf with doctors than about helping them understand our medicines has earned our industry a reputation near the bottom of all American institutions," said Pfizer chief executive officer Jeff Kindler in 2009.

He is not alone in recognising the challenge that faces pharmaceutical companies' corporate brands in today's marketplace.

Miles D White, chief executive officer of Abbott, has said: "Today we're in an all-out war for reputation. Our companies are battling — to an unprecedented extent — for our most vital assets: our own identities."

However, merely recognising this challenge is not sufficient; a method of overcoming it must also be found.

Andrew Witty, chief executive officer of GlaxoSmithKline, offers this advice: "It is time for a new mindset in our industry and a new contract with society. With the support of other pharmaceutical companies and partners outside the industry, I believe significant improvements in human health can really be achieved."

This new 'contract' is a call to start building confidence in the industry, to overcome patients' anxieties that pharmaceutical companies place profits before people. As the industry has started to diversify in response to dwindling pipelines, tougher regulations and tighter budgets, each company has started to create a personality of its own: an essence. A reputation.

The idea of pharmaceutical companies forging new and unique identities is not a novel one, but as PricewaterhouseCoopers (PwC) has clearly stated: "Those companies that are unable to build a positive reputation are going to be forced into a commodity market based on price while those who succeed can sustain premium pricing."

So, how has the need to re-evaluate corporate reputation as a tool for providing equity come about? Pharmaceutical company shareholders, used to growth outstripping the stock market as a whole, saw the FTSE Global Pharmaceutical Index rise just 1.3 per cent in the six months up to 2007, compared with the Dow Jones World Index increase of 34.9 per cent (according to PwC).

Quite simply, the old sales model (blockbusters sold by huge sales forces making great profits) is diminishing. Pipelines aren't replenishing and healthcare systems are expecting more value for money. Patient activism and voice have risen, and regulation has become increasingly hostile in the dire economic situation that has developed over the last two years.

We know it's an important topic. We know that at some level we can have an impact, but what we have lacked in the past is evidence to prove the impact of investing and developing in corporate brand equity in our industry.

Benefits and rewardsThe benefits of a strong corporate reputation are multifold: attracting and retaining talent; providing stronger negotiation positions with regulatory authorities, and aiding diversification into new revenue streams.

Some great evidence of how the corporate brand has been used successfully to deliver a competitive advantage is the Pfizer 'More than Medicine' campaign in Canada.

The campaign itself comprised a series of short clips promoting health management and wellness, with a view to encouraging consumers towards a web platform that advises on how to live well using the corporate brand as the platform from which to deliver the message.

Why did Pfizer choose this method of communication? Research conducted in Canada showed that patients were becoming increasingly active in choosing their treatments. In addition, it showed that corporate brand values had a role in the decision making process. Finally, both healthcare professionals (HCPs) and consumers felt that there was a lack of useful, credible information around health and wellness available online.

The impact? The campaign resulted in positive consumer perceptions towards Pfizer in Canada, encouraging goodwill and positive opinion because of the associated notions of preventative medicine. But importantly, albeit anecdotally, the halo effect with politicians and HCPs was that the number of partnerships increased.

Closer to home, sanofi-aventis has shown how research into corporate brand equity can be used to deliver success at a therapy area level.

In 2009 sanofi-aventis and Kantar Health set out to evaluate the equity of the corporate brand with a robust study of healthcare respondents across a range of therapy areas, including traditional customers and Secondary and Primary Care Medicines Management.

Analysis showed a clear relationship between a strong corporate reputation and increased access to customers, together with a willingness to partner on non-clinical initiatives.

The reputation research developed an index number measured through rational, practical and emotional beliefs.

The sanofi-aventis results were benchmarked against different industries and different UK geographies as well as worldwide.

Sanofi-aventis scored above average compared to other broad based pharmaceutical companies, other industries, and across Europe. Comparisons to a range of specialist companies demonstrated the viewpoint of specific audiences and helped to develop a strategy for improvement in a particular area.

The research showed that attributes driving corporate reputation differ in importance between stakeholder groups. It revealed the 'essentials', the 'drivers' and the 'hidden opportunities'. The understanding from the research made all the difference when co-ordinating communications to enhance corporate reputation.

In line with the company vision, 'Aiming to be the partner of choice to those committed to improving people's health', a programme was designed to support healthcare professionals in improving patient outcomes.

Best practice demands the measurement of results following the implementation of a new programme. The same attributes and drivers, together with an analysis of verbatim reports, were used in this exercise.

The results demonstrated not only the success of the programme overall but quantitatively we were able to show a substantial increase in the strength of relationship with the group that had been involved in the programme, as opposed to the control group, which had not been involved and whose relationship index did not change. It was also demonstrated that this increase was linked specifically to sanofi-aventis.

The actionable recommendations from the research therefore led to a programme tailored to a specific segment and measurement showed successful improvement in relationship in the group for whom it was designed.

Our new contractWe've talked about the importance of corporate reputation within the changing nature of the market; our CEOs support the need for improved reputation for pharma both as a group and as individual companies, we've given evidence as to the benefits of corporate brand equity in accessing customers, willingness to partner and so on, but what is key is to understand why the role of business intelligence is so important.

Consider the work business intelligence does with stakeholders: understanding their behaviours, motivations and attitudes. To begin to understand what a company needs to mean to a stakeholder, one needs to understand stakeholders completely. Think also about the work this function does every day to drive brand equities across business units. Market researchers are perceived to be the 'truth warriors' of an organisation; surely, therefore, business intelligence is ideally placed to provide objective input when building corporate brand equity.

Until now research has typically involved the marketeer, the agency and business intelligence, but perhaps this should become a pentagon, with PR, communications, Corporate Social Responsibility and other departments working together to transcend corporate brand essence through the different business units. Andrew Witty talks about a 'new contract with society.'

Perhaps business intelligence divisions are in a position to forge a new contract for themselves? A contract that encourages them to give consideration to the role of the corporate brand in their day-to-day work.

The AuthorsJames Macleod is associate director at Kantar Health (formerly TNS Healthcare), and Sally Burgess is senior market research manager at sanofi-aventis